CAN UNEMPLOYMENT BE GOOD FOR THE ECONOMY?

posted by Michael Chihak

Former Democratic legislator and state budget director George Cunningham argues in an op-ed piece in today's Arizona Republic that extending unemployment benefits would be good for Arizona's economy.

"When the nonpartisan Congressional Budget Office evaluated components of the federal stimulus program from spending to tax cuts, it found extending unemployment benefits was the most effective instrument," Cunningham wrote, citing what he said are $3.2 million in weekly payments that are set to expire on Saturday.

Those payments would go in weekly increments to an estimated 15,000 Arizonans who have been out of work 18 months, the period covered by regular state and federal unemployment payment programs.

Republicans in control of the state Senate say they aren't interested in extending the benefits, for a range of reasons. One says people getting unemployment payments don't have an incentive to find work; others say that although the money used for the extended benefits is federal, it adds to the nation's overall debt.

Cunningham said in his op-ed piece that statistical modeling shows a near doubling of economic impact and that it would support for than 1,100 jobs in the state.

JOBLESS BENEFITS IN PERIL UNLESS STATE ACTS

posted by Michael Chihak

BY DIANA SOKOLOVA

Will Arizona's governor and Legislature approve an extension of unemployment benefits for an estimated 15,000 Arizonans before the deadline expires on Saturday?

Whether they act or not, Arizona Week on Friday will look at the political and economic ramifications of extending benefits for people who have been out of work at least 18 months.

Brewer has indicated she is willing to allow extension of the benefits, but until now, she hasn't called the special legislative session that would be needed to change the law, because lawmakers have not agreed to vote for an extension.

Arizona’s April unemployment rate was 9.3 percent, the U.S. Bureau of Labor Statistics reported. The rate dropped from 9.5 percent in March and 9.6 percent in February 2011. The report for May will be released on June 17.

The Bureau of Labor Statistics reported 297,457 people were registered as unemployed in April in Arizona, down from 303,209 in March. Unemployment peaked in January at 304,828.

The bureau reported Phoenix metropolitan area unemployment at 8.1percent, Tucson 7.9 percent, Yuma 25.3 percent, Prescott 9.5 percent and Flagstaff 7.6 percent.

Weekly unemployment benefits range from $60 to $240, depending on what a person earned when employed, according to the Arizona Department of Economic Security. Total cost of the Extended Benefit Program, all federal money, is $3.5 million a week in Arizona.

Arizona provides 26 weeks of state unemployment benefits, an additional 53 weeks of federal emergency benefits and, under the Extended Benefit Program, an additional 20 weeks for the long-term unemployed. That last 20 weeks is what is in jeopardy unless new legislation is enacted.

TUCSON MORE CONSERVATIVE THAN PHOENIX?

posted by Michael Chihak

Tucson mortgage lenders probably acted more conservatively than their counterparts in Phoenix during the boom times in the real estate industry, accounting for the difference between the two metro areas in the severity of the real estate crisis.

So says Judy Lowe, Arizona's real estate commissioner. In an interview with Arizona Week, Lowe said Phoenix is worse off than Tucson, with "distressed properties" accounting for 72 percent of the metro area's housing sales. She didn't have a figure for Tucson, but said it is "not quite as bad, not quite as negative."

The difference?

Many more houses were sold in the Phoenix area than in Tucson during the height of the boom, 2005 and 2006, Lowe said. Additionally, she said: "Maybe Tucson was more conservative than the Phoenix valley in how those homeowners qualified for their mortgages."

One issue nationally during the mortgage financing crisis was that of sub-prime mortgages, awarded to people whose qualifications had not been thoroughly checked or who were allowed to take out mortgage loans at higher interest rates despite having marginal financial means.

HOME PRICE STABILITY IN ARIZONA?

posted by Michael Chihak

Some housing experts and economists say Arizona's housing market won't be back to normal for another four to five years, perhaps even longer depending on what happens with other parts of the economy.

Before normalcy, the slow-growing state must absorb nearly 100,000 houses that shouldn't be on the market now but are up for sale. That's because they were foreclosed on, their mortgages in default from owners who lost their jobs, were in over their heads or otherwise suffered the unforgiving pummeling of the financial meltdown.

If the market weren't glutted with those foreclosure sales, would it be operating at a decent pace?

That's a question we will ask Arizona Real Estate Commissioner Judy Lowe for this Friday's Arizona Week.

We also will ask her if trends she is seeing in real estate broker and agent licensing and other statistics portend any positive trends in the market, how the real estate industry may have been permanently altered by the housing bust and if she is noticing signs of stability in pricing and other aspects of the real estate market.

ARIZONA FORECLOSURE PLIGHT CONTINUES

posted by Michael Chihak

By DIANA SOKOLOVA Arizona Week Intern

Arizona’s housing market is struggling to improve after home values collapsed in the last three years. The state is second after Nevada in foreclosure rate. A total of 93,413 foreclosed homes were on the market as of today, according to RealtyTrac, a real estate data provider.

Arizona is among six states – Nevada, California, Florida, Illinois and Michigan are the others – accounting for well more than half the nation’s total foreclosure activity with nearly 1.6 million properties receiving a foreclosure filing in 2010, according to the United States Foreclosure Filing report.

The foreclosure rate in Arizona jumped 22 percent from April 2010 to this April.

RealtyTrac reported that one in every 205 homes in Arizona received a foreclosure filing this April. There were 13,419 new foreclosure properties on the market for the first quarter of the year, the organization reported.

Pinal County had the worst rate of foreclosures in April. 1,034 homes or one in 143. Maricopa County had 9,324 home foreclosures, one in 170. Pima County had 1,686 properties, one in 254, according to RealtyTrac’s report.

On average, homes in Arizona sell for $129,032, RealtyTrac reported.

April 2011 was the second month in a row for Phoenix-area foreclosure rates to drop, an Arizona State University professor of real estate and finance reported. Associate Professor Jay Butler said the drop is not significant enough to improve the overall situation of high the foreclosure rate in the market.

The Arizona Republic in a May 11 story reported that “In April, the Phoenix area had 3,745 foreclosures. That’s down from 4,145 in March but more than the 3,490 foreclosures in April 2010.”

GOOD PLANNING OR GOOD LUCK? WE'LL TAKE BOTH

posted by Michael Chihak

Arizona Week's story focusing on how the 15 counties in the state are coping financially presented us with a significant logistical issue.

The concept was to look at the big picture situation across the state and then focus on a couple of counties, one urban and one rural. But how to do so and capture county officials on camera without having to drive hither and yon was the dilemma.

That is, until Craig Sullivan of the County Supervisors Association of Arizona entered the picture. A Tuesday call to Sullivan was part of the routine, requesting that he appear on camera. He said he preferred that the association's president, Navajo County Board of Supervisors Chairman David Tenney, speak for the group.

How to get Tenney without a drive to Show Low was the question. But not for long.

"He will be in Phoenix later this week for our board meeting, as will supervisors from all over the state," Sullivan said. He then proceeded to set up interviews for us with Tenney and Maricopa County Board of Supervisors Chairman Andy Kunasek for Thursday after the association board meeting.

Tenney, speaking for the association and giving the big picture, plus being from a rural county, filled two of the three needs for the story. Kunasek, from the biggest county, fulfilled the third.

And with all counties working on their budgets -- Maricopa County gave tentative approval to its this week; Pima County did the same last week -- the time is right for the story.

We were prepared to do it and were favored by the fortune of having the key people to talk to in one convenient place at the same time.

Watch Friday at 8:30 p.m. MST on PBS HD, or catch it at www.azweek.com.